If given the Selling price, the direct labor costs and other variable costs how do you determine the number of direct labor hours per unit?

To determine the number of direct labor hours per unit, you need to know the total direct labor costs and the variable cost per unit. Once you have this information, follow these steps:

1. Subtract the other variable costs from the total direct labor costs. This will give you the direct labor costs per unit.

2. Divide the direct labor costs per unit by the variable cost per unit. The result will be the number of direct labor hours per unit.

Let's break this down with an example:

Suppose the selling price of a product is $100. The total direct labor costs are $5000, and the other variable costs are $2000. The variable cost per unit is $10.

1. Subtract the other variable costs ($2000) from the total direct labor costs ($5000):
$5000 - $2000 = $3000

2. Divide the direct labor costs per unit ($3000) by the variable cost per unit ($10):
$3000 Ă· $10 = 300

Therefore, the number of direct labor hours per unit is 300.